Lafarge may need to divest of more Indian assets due to mining regulations

Lafarge India has submitted a revised proposal to the Competition Commission of India (CCI) to sell its entire 11Mta of assets in India, Business Standard reports, citing an investment banker familiar with the development.

This decision comes after Lafarge's plan to sell its 5.15Mta cement capacity in Chhattisgarh and Jharkhand to Birla Corp has hit a hurdle due to mining regulations. Investment bankers said the MP Birla Group company was facing challenges in securing limestone mining rights for the two units.

“Lafarge India has sought an extension of its deadline from the CCI to complete its divestment,” said an investment banker familiar with the development. “Lafarge India has now put the entire company on the block, as the sale of the entire company will include transfer of mining rights," the source told the business title.

However, some media reports also report that the Indian government is close to amending the new mining bill (MMDR Act) to allow for transfer of allotted captive non-coal mines.

The CCI had asked Lafarge India to sell its 5.15Mta capacity in eastern India by 31 December to complete its global merger with Holcim.